The case ITA No. 1104/DEL/2021 involves the appeal filed by Ganga Jamuna Culture Foundation against the rejection of its applications for registration under sections 12AA and 80G of the Income Tax Act, 1961. The appeal is directed against the order passed by the Commissioner of Income Tax (Exemption) [CIT(E)], New Delhi, for the assessment year 2020-21. The appeal was filed on 14th September 2021, and the final tribunal order was pronounced on 25th November 2021.
Ganga Jamuna Culture Foundation, the appellant, submitted applications for registration under section 12AA and approval under section 80G of the Income Tax Act, 1961, electronically on 9th December 2019 and 18th December 2019, respectively. The CIT(E), New Delhi, issued a letter on 20th January 2020, requesting the appellant to submit specific documents to support its claims. The hearing was scheduled for 4th February 2020, but no one appeared on behalf of the appellant.
The CIT(E) issued additional notices on 19th June 2020 and 4th September 2020, requesting compliance by 26th June 2020 and 11th September 2020, respectively. Despite these notices, the appellant failed to respond or submit the required documents. As a result, the CIT(E) rejected the applications in the appellant’s absence.
Aggrieved by the rejection, the appellant filed an appeal with the Income Tax Appellate Tribunal (ITAT), Delhi Bench “C”. The appeals, numbered ITA 1103/DEL/2021 and ITA 1104/DEL/2021, were heard together and disposed of through a consolidated order.
During the hearing, the appellant’s representative, Shri Yudhistar Mehtani, CA, argued that due to the Covid-19 pandemic, the proceedings could not be attended, and the required documents could not be filed. He contended that the appellant was not granted a meaningful opportunity to present its case and requested that the applications be restored to the CIT(E) for a fresh decision.
The respondent, represented by Shri Vinay Kumar Karan, CIT DR, opposed the appeal, arguing that the appellant was negligent and failed to comply with the notices issued by the CIT(E). However, he left the decision to the Tribunal’s discretion, given the circumstances.
The Tribunal noted that the CIT(E) had issued multiple notices and provided ample opportunities for the appellant to comply. However, due to the widespread impact of the Covid-19 pandemic and the associated lockdowns, the Tribunal acknowledged the difficulties faced by the appellant.
In the interest of justice and to provide a meaningful opportunity for effective representation, the Tribunal decided to set aside the impugned order and restore the applications for registration under section 12AA and approval under section 80G to the CIT(E). The CIT(E) was directed to conduct a fresh inquiry and decide the applications in accordance with the law, ensuring that reasonable opportunities for hearing are provided to the appellant.
The appeals filed by Ganga Jamuna Culture Foundation were allowed for statistical purposes, and the case was remanded back to the CIT(E) for a fresh decision. The Tribunal emphasized the importance of providing the appellant with a fair opportunity to present its case, especially given the extraordinary circumstances caused by the Covid-19 pandemic.
The order was pronounced in the open court on 25th November 2021 by Shri G.S. Pannu, President, and Shri Kul Bharat, Judicial Member.
This case underscores the need for tax authorities to consider the exceptional circumstances posed by the Covid-19 pandemic while making decisions. It also highlights the importance of providing fair and reasonable opportunities for appellants to present their cases, ensuring that principles of natural justice are upheld.
The decision in this case can serve as a precedent for future cases where appellants face similar challenges due to unforeseen circumstances. It reinforces the Tribunal’s role in ensuring that justice is served by providing fair opportunities for all parties involved.
Rejection of 12AA & 80G Registration: Ganga Jamuna Culture Foundation vs CIT (E) – ITA 1104/DEL/2021
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